1. Strategic Importance of Project Management
Bechtel Kuwait Project:
8,000 workers
1,000 construction professionals
100 medical personnel
2 helicopter evacuation teams
6 full-service dining halls
27,000 meals per day
40 bed field hospital

2. Strategic Importance of Project Management
Microsoft Windows Longhorn Project:
hundreds of programmers
millions of lines of code
millions of dollars cost
Ford Redesign of Mustang Project:
450 member project team
Cost $700-million
25% faster and 30% cheaper than comparable project at Ford

3. Project Characteristics
Single unit
Many related activities
Difficult production planning and inventory control
General purpose equipment
High labor skills

4. Examples of Projects
Building Construction
Research Project

5. Project Organization Works Best When
Work can be defined with a specific goal and deadline
The job is unique or somewhat unfamiliar to the existing organization
The work contains complex interrelated tasks requiring specialized skills
The project is temporary but critical to the organization

6. Management of Projects
Planning - goal setting, defining the project, team organization
Scheduling - relates people, money, and supplies to specific activities and activities to each other
Controlling - monitors resources, costs, quality, and budgets; revises plans and shifts resources to meet time and cost demands

7. Project Management Activities
Planning
Objectives
Resources
Work break-down schedule
Organization
Scheduling
Project activities
Start & end times
Network
Controlling
Monitor, compare, revise, action

8. Project Planning, Scheduling, and Controlling
Figure 3.1
Before Start of project During
project Timeline project

9. Project Planning, Scheduling, and Controlling
Figure 3.1
Before Start of project During
project Timeline project

10. Project Planning, Scheduling, and Controlling
Figure 3.1
Before Start of project During
project Timeline project

11. Project Planning, Scheduling, and Controlling
Figure 3.1
Before Start of project During
project Timeline project

12. Project Planning, Scheduling, and Controlling
Time/cost estimates
Budgets
Engineering diagrams
Cash flow charts
Material availability details
Budgets
Delayed activities report
Slack activities report
CPM/PERT
Gantt charts
Milestone charts
Cash flow schedules
Figure 3.1
Before Start of project During
project Timeline project

13. Project Planning Establishing objectives Defining project
Creating work breakdown structure
Determining resources
Forming organization

14. Project Organization Often temporary structure
Uses specialists from entire company
Headed by project manager
Coordinates activities
Monitors schedule and costs
Permanent structure called ‘matrix organization’

15. A Sample Project Organization
Marketing
Finance
Human
Resources
Design
Quality
Mgt
Production
President
Technician
Project 2
Project
Manager
Electrical
Engineer
Computer Engineer
Test
Engineer
Mechanical
Project 1
Project
Manager
Technician
Figure 3.2

16. Matrix Organization Marketing Operations Engineering Finance Project 1

17. The Role of the Project Manager
Highly visible
Responsible for making sure that:
All necessary activities are finished in order and on time
The project comes in within budget
The project meets quality goals
The people assigned to the project receive motivation, direction, and information

18. The Role of the Project Manager
Highly visible
Responsible for making sure that:
Project managers should be:
Good coaches
Good communicators
Able to organize activities from a variety of disciplines
All necessary activities are finished in order and on time
The project comes in within budget
The project meets quality goals
The people assigned to the project receive motivation, direction, and information

19. Ethical Issues
Bid rigging – divulging confidential information to give some bidders an unfair advantage
“Low balling” contractors – try to “buy” the project by bidding low and hope to renegotiate or cut corners
Bribery – particularly on international projects
Expense account padding
Use of substandard materials
Compromising health and safety standards
Withholding needed information
Failure to admit project failure at close

20. Work Breakdown Structure
Level
Project
Major tasks in the project
Subtasks in the major tasks
Activities (or work packages) to be completed

21. Work Breakdown Structure
Level ID Level Number Activity
1 1.0 Develop/launch Windows Longhorn OS
Development of GUIs
Ensure compatibility with earlier Windows versions
Compatibility with Windows ME
Compatibility with Windows XP
Compatibility with Windows 2000
Ability to import files
Figure 3.3

22. Project Scheduling Identifying precedence relationships
Sequencing activities
Determining activity times & costs
Estimating material and worker requirements
Determining critical activities

23. Purposes of Project Scheduling
Shows the relationship of each activity to others and to the whole project
Identifies the precedence relationships among activities
Encourages the setting of realistic time and cost estimates for each activity
Helps make better use of people, money, and material resources by identifying critical bottlenecks in the project